Businesses

Choosing a Business Structure

Your business structure must fit your business needs. As your business grows or your personal financial situation changes, the business form in which you operate may need to change, as well. Keep in mind that the business structure you choose will impact your personal liability, as well as the amount of tax owed by you and your company.

Each business structure has its advantages and disadvantages. Which is right for you? That's a decision that may be best made between you and your team of financial and legal advisors.

For tax years beginning after 12/31/17, the “c” corporation Federal tax rate is a flat 21%. Owners of business entities, which are not taxed as “C” corporations, are eligible for a 20% Qualified Business Income (QBI) deduction. The deduction for QBI may be limited and/or subject to phase-out, depending on the taxable income of the individual, as well as such factors as the type of business, amount of wages paid by the business, and amount of capital assets owned by the business.